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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Raymond Duray who wrote (60668)	3/1/2005 12:14:07 PM
From: Maurice Winn	Read Replies (1) \| Respond to of 74559

<Lord Browne is one of the largest investors in solar power on the planet. I believe he understands better than most what the future of the oil industry is likely to be.> Back in 1988, in the Market Strategy Branch my colleague and I were given a job to review the prospects of photovoltaics and whether it was worth pursuing. That was while Lord Browne was still paddling around in chemicals [I think he was still running that division]. Well before that, BP was investing in hydrogen fusion technology - that was in the blue skies R&D department. Photovoltaics was in 'sell this stuff' mode. Contrary to popular rumour, the oil industry does NOT buy "runs on water technology" to shut it down to prevent competition with oil. On the contrary, BP put a lot of money into any sort of project which might make a load of money and would fit with the business. My job was in part to come up with such stuff and work with lots of others who were doing much the same. It wasn't a trivial little effort in a back room. None of which is to say the oil industry was thought to be a dying industry. I did get into a discussion in mid 1986 with Brian Baker, the Manufacturing Manager, when I was advocating we introduce methanol to California as a car fuel. He said "Are you serious? Do you know how much money we have invested in refining? You are talking about shutting down an umpty $billion industry." My argument was that if we didn't do it, DuPont and others would, since the barriers to entry were not particularly high, so we could lose business and not be in the new one, or, using the existing strengths [strings of service stations and distribution facilities plus marketing power and technical know-how], BP could lead the new industry and enjoy a large market share. The outcome was that crude oil prices sagged all the way down and methanol became an also-ran. We canned the 100% methanol projects. Saudi Arabia doesn't really want methanol taking over [they have heavy crudes, not so much gas, from which methanol is made], nor El Matador's biomass-derived ethanol. They will cut their price to maintain market share. The future of the oil industry is still pretty good, as Lord Browne says. He is planning on expanding the oil business. Mqurice PS: I plead guilty to promoting the idea that cars can run on water by tricking a service station attendant into adding a litre or so of water to my methanol-powered car's fuel tank, telling him it runs on water. I also bought a litre of petrol for the little starter system under the bonnet [the hood], which included a one litre plastic 'tank' for petrol - it started on petrol and ran for a few minutes until it was warm enough to evaporate methanol in the water-jacketed swirl chamber attached to the carburettor. He was raving to the cash register guy that he'd put the water in himself!!! "IT RUNS ON WATER!". I had my fingers crossed that the water would have mixed sufficiently to get me off the forecourt [water is more dense than methanol but totally miscible in any proportion].